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The wage effects of schooling under socialism and in transition: Evidence from Romania, 1950-2000

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  • Andren, Daniela
  • Earle, John S.
  • Sapatoru, Dana

Abstract

We estimate the impact of schooling on monthly earnings from 1950 to 2000 in Romania. Nearly constant at about 3-4 percent during the socialist period, the coefficient on schooling in a conventional earnings regression rises steadily during the 1990s, reaching 8.5 percent by 2000. Our analysis finds little evidence for either the standard explanations of such an increase in the West (labor supply movements, product demand shifts, technical change) or the transition-specific accounts sometimes offered (wage liberalization, border opening, increased quality of education). But we find some support for institutional and organizational explanations, particularly the high productivity of education in restructuring and entrepreneurial activities in a disequilibrium environment.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Comparative Economics.

Volume (Year): 33 (2005)
Issue (Month): 2 (June)
Pages: 300-323

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Handle: RePEc:eee:jcecon:v:33:y:2005:i:2:p:300-323

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Web page: http://www.elsevier.com/locate/inca/622864

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Citations

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Cited by:
  1. Orlowski, Robert & Riphahn, Regina T., 2008. "The East German Wage Structure after Transition," IZA Discussion Papers 3861, Institute for the Study of Labor (IZA).
  2. Andrén, Daniela, 2010. ""In every rank, or great or small, ’Tis industry supports us all": Romanians and ethnic Hungarians, and their wages, in transition," Working Papers 2010:1, Örebro University, School of Business.
  3. Jarko Fidrmuc & Matus Senaj, 2012. "Human Capital, Consumption, and Housing Wealth in Transition," Working and Discussion Papers WP 2/2012, Research Department, National Bank of Slovakia.
  4. Wyrwich, Michael, 2013. "Can socioeconomic heritage produce a lost generation with regard to entrepreneurship?," Journal of Business Venturing, Elsevier, vol. 28(5), pages 667-682.
  5. Andrén, Daniela, 2012. "Romanians, Hungarians and their wages, in transition, in Romania," Economic Modelling, Elsevier, vol. 29(6), pages 2673-2685.
  6. Li, Hongbin & Liu, Pak Wai & Zhang, Junsen, 2012. "Estimating returns to education using twins in urban China," Journal of Development Economics, Elsevier, vol. 97(2), pages 494-504.
  7. Giorgio Brunello & Elena Crivellaro & Lorenzo Rocco, 2012. "Lost in transition?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 20(4), pages 637-676, October.
  8. Andrén, Daniela & Andrén, Thomas, 2007. "Occupational Gender Composition and Wages in Romania: From Planned Equality to Market Inequality?," IZA Discussion Papers 3152, Institute for the Study of Labor (IZA).
  9. John Earle, 2012. "Industrial decline and labor reallocation in a transforming economy: Romania in early transition," IZA Journal of Labor & Development, Springer, vol. 1(1), pages 1-18, December.
  10. Kevin Denny & Patrick Orla Doyle, 2005. "Returns to basic skills in Central and Eastern Europe - a semi-parametric approach," Working Papers 200507, School Of Economics, University College Dublin.
  11. Brunello, Giorgio & Crivellaro, Elena & Rocco, Lorenzo, 2010. "Lost in Transition? The Returns to Education Acquired under Communism 15 Years after the Fall of the Berlin Wall," IZA Discussion Papers 5409, Institute for the Study of Labor (IZA).
  12. Jarko FIDRMUC & Matus SENAJ, 2014. "Income, Schooling and Housing Wealth during Economic Reforms," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 64(2), pages 160-176, March.
  13. Elizabeth Brainerd, 2010. "Human Development in Eastern Europe and the CIS Since 1990," Human Development Research Papers (2009 to present) HDRP-2010-16, Human Development Report Office (HDRO), United Nations Development Programme (UNDP).

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